Bacanora Minerals Enters Lithium Carbonate Offtake Agreement with Hanwa

- April 10th, 2017

Bacanora Minerals Ltd. (TSXV:BCN,LSE:BCN) announced that it has entered into a strategic partnership with Japan’s Hanwa Co. Ltd., one of the larger traders of battery chemicals in the Asian region. Hanwa reported net sales of over 1,500 billion yen in 2016.

Bacanora Minerals Ltd. (TSXV:BCN,LSE:BCN) announced that it has entered into a strategic partnership with Japan’s Hanwa Co. Ltd., one of the larger traders of battery chemicals in the Asian region. Hanwa reported net sales of over 1,500 billion yen in 2016.
As quoted in the press release:

The Agreement is comprised of both an initial 10% equity investment in Bacanora and an Off-take Agreement for up to 100% of the battery grade lithium carbonate (“Li2CO3“) produced at the Sonora Lithium Project (“Sonora” or the “Project”).  The Company is targeting to produce 17,500 tonnes of Li2CO3 per annum (“Stage 1”), commencing in 2019.  After two years of producing at this level, the Company plans to lift production to 35,000 tonnes per annum (“Stage 2”)[1].

Highlights include:

  • Milestone Off-take Agreement for up to 100% of Li2CO produced at Sonora:
    • Hanwa to purchase 70-100% of lithium carbonate produced during Stage 1
    • Tonnage based contract for battery grade lithium carbonate at  market pricing, with final pricing to be finalised prior to commencement of production
    • Option to increase the off-take tonnage by up to 100% at Stage 2 production
  • Company-level investment demonstrates Hanwa’s commitment to Bacanora and represents the entry of a new long term, supportive investor to the register:
    • Hanwa to acquire an initial 10% interest in Bacanora, raising approximately £10,175,000 (approximately C$16,896,000) in proceeds to the Company via the placement of 12,333,261 shares at a price of 82.5 pence (approximately C$1.37) per share (the “Placing”)
    • Hanwa is entitled to present a nominee for election to the board of directors of Bacanora and has a pre-emptive right to maintain its 10% equity interest
    • Hanwa shall have an option to increase its equity interest in Bacanora to 19.9%.
  • The Agreement provides a funding platform for the Project – Hanwa represents a cornerstone investor and will aid in the procurement of long term project debt funding  
  • Validates the quality of the battery grade (+99.5%) lithium carbonate product and Bacanora’s production process
    • Hanwa has received numerous samples of the Company’s battery grade product and has  distributed samples to a number of their customers

Click here to read the full Bacanora Minerals Ltd. (TSXV:BCN,LSE:BCN) press release.

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